Health care exchange decision day: 25 states won’t build them

posted at 6:01 pm on December 14, 2012 by Mary Katharine Ham

The stage is set. The federal government will have to build a health care exchange that will work for half of the states in the country by October of 2013.

The implementation of ObamaCare assumed that the states would do the work of setting up individual state exchanges to provide a clearinghouse of health insurance information for the public, and provide the mechanism that triggered enforcement of the law against those employers who were accused of violations.

There are just 33 problems. That’s the number of states that have chosen to either not implement a state exchange at all or engage in a hybrid system that leaves many of the problems up to the federal government, as is the case with Illinois, Delaware and North Carolina, or which remain undecided on whether to accept the responsibility for developing the exchange.

Already, 25 states representing 45 percent of the U.S. population have told the Obama administration that they will not be spending the time, energy and effort to build a state exchange, when ultimately the federal government would have to approve virtually every decision that was made. These states have effectively told the Feds that they won’t own the vast array of problems created under ObamaCare when they won’t have the flexibility or ability to fix them.

Democratic partisans claim states punting the exchanges are making a spiteful political decision, but they ignore the fact that the federal government is nowhere near ready to deploy either a federal data hub state exchanges will have to plug into or a federal exchange. Surely the federal government, headed by the man whose legacy is staked on this project, is the least spiteful actor in this scenario, yet it’s not performing up to par, either. The feds foolishly assumed every state would build a state exchange even though, during the legislative process, they didn’t attempt to get the buy-in they’d need to assure that. In truth, the objections to building exchanges have at least as much to do with logistics as politics.

For political reasons, the Obama administration didn’t even release draft regulations for what exchange-eligible plans must cover until two weeks ago. Right now, insurance carriers are frantically running those requirements to actuaries, who are frantically pricing them, so that the carriers can then file for necessary rate-hikes with state insurance commissions across the country. The timeline has been condensed to the point that even the most willing and ready state, Maryland, is concerned about the aggressive technological build-out it has to complete this year. At a December town hall meeting about implementation in Maryland, an official with the state health care commission joked that you could identify the IT guys in the room because they were “sweating profusely.”

Others claim Republican governors are hypocritically foisting power back onto the federal government that they could have had at a state level. As the Hill write-up acknowledges, the many as-yet unwritten regulations being filled out in the federal legislation guide so many aspects of the exchange’s requirements that state power would be negligible, rendering them culpable for the system’s failures with little to no power to fix them. If states truly could opt for flexibility by building their own exchanges, Utah’s five-year-old exchange might be welcomed into the fold. Thus far, that’s not the case, though Utah is asking for consideration and is planning to keep the exchange up and running.

Most of the reporting on exchanges takes for granted that the exchanges “will do this” and “will do that,” just like a “Travelocity for health care.” Not much of it grapples with what it takes to make the exchanges do that, which is a daunting technological synching of federal government data (on a hub not yet created) with each state’s health care regulatory structures and their technological components, which would then apply a complicated sliding-scale formula never before used by the IRS to inform consumers what subsidies are available to them to buy from an array of insurance choices still being created by insurance companies, which meet a set of guidelines for Essential Health Benefits not yet finalized.

Everyone knows I’m not a fan of Obamacare, but fan or no, one must concede that seems like quite a lot for federal and state governments to accomplish smoothly before October. The law also requires customer service representatives called Navigators be trained to guide consumers seamlessly through these not-yet-existent systems. Even if the only requirement were for every state or the federal government to build a user-friendly, functioning website by October, I’d be skeptical of their ability to get there. As it is, there’s much more than that to do.

One big issue is cost: the law requires states to find their own funding for the exchanges by 2015.

This month, Maryland officials estimated a long-term cost of $33 million a year to run its exchange and suggested charging carriers an assessment to join the exchange, as well as a fee on group plans sold outside the exchange, to pay for it.

The federal government plans to charge a 3.5% fee on plans sold through exchanges it operates.

All these problems were embedded in the original bill and many of them were exacerbated by the process by which it was passed and the administration’s unwillingness to own up to regulations before the election.

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I have experience in such systems. It is impossible for the Federal government to build the data hub and the mega-exchange(s)in the time available. It cannot be done. Even the rules and policies necessary for technical work to be done are not yet in place. If all goes well and they can find and retain the talent they are 2-3 years out minimum.

Me thinks that bho/team are working 24/7 trying to find ways to ‘punish’ those states who opp out? And it should be some dandy ‘punish’ if I know bho? bho does not like it when anyone goes against him, NO ONE!
L

So 25 states say no. Another 7 say shared with the feds. Only 18 are going ahead with State-Run exchanges. With the exception of Idaho, Utah, Kentucky and Mississippi, all of the ones going State-Run are heavy Blue States. They want it, they can have it. Beware what you wish for, you just might get it…and a hugh bankrupcy-inducing debt to go with it.

Single Payer is the only goal of this administration and the progressive leftist. Maryland is losing many of its wealthiest job creators. They are opting for more sensible government. I don’t blame them one bit. Maryland is/will be little more than a Federal Employee state. The administration sees to this daily. Fairfax County Va. is/will be much the same.

Me thinks that bho/team are working 24/7 trying to find ways to ‘punish’ those states who opp out? And it should be some dandy ‘punish’ if I know bho? bho does not like it when anyone goes against him, NO ONE!
L

letget on December 14, 2012 at 6:20 PM

In Barky’s position I wouldn’t even attempt this. I’d issue a raft of EOs (which would probably be illegal on one or more levels) vastly simplifying the funding of OCare and go FORWARD.

Yes, 25 states and some other Tea Baggers would sue. But by the time this all got resolved, I’d be kickin’ it on my private beach in Hawaii chooming away and laughing my ass off.

Yes – and the blue states will lose more businesses as they realize moving to a state with a federal exchange will be less expensive.

If HHS wanted to make this happen all they had to do was loosen the rope a little bit and let some states experiment. But they didn’t – so now we will see the result of that failure. The feds cannot create the exchanges and neither can the states who are so inclined to do so – ask Maryland what they have actually DONE to establish an exchange. It is nothing more than forward PR for the most part.

In reality – what is going to happen is that employers are facing an additional 10-15%% increase in their healthcare costs on top of the typical things driving increased cost – like provider increases and utilization spikes. This is driven by ObamaCare. if you figure Health care by itself cost employers anywhere from 15-25% of the total compensation – you have just cost about 3% of employees in 2013 their jobs due to the act. Then they can at least get Medicaid – not that many providers will see them.

Yes, 25 states and some other Tea Baggers would sue. But by the time this all got resolved, I’d be kickin’ it on my private beach in Hawaii chooming away and laughing my ass off.

CorporatePiggy on December 14, 2012 at 6:31 PM

This.

Except that a whole bunch of tea baggers and assorted motley malcontents are busy setting up “arrangements” with “retiring” doctors so that their actual health care can be accessed on a cash basis no matter what the lunatic left decides to do.

Mary Katharine, would you mind settling something for me? Can you ban folks here?

Bmore on December 14, 2012 at 6:08 PM

I think I can, but I take a very light hand with comments, so I haven’t.

Mary Katharine Ham on December 14, 2012 at 6:10 PM

Seriously folks, what’s up with the banning requests? Are you that scared of trolls coming in and posting some idiotic thing that most people laugh at? I would expect liberals to be heavy handed on the ban button because they hate to be challenged. I would expect more cajones out of a bunch of conservatives who usually relish debate.

They don’t even have the problems worked out with the EMR mandates enacted in 2009 or the change in billing codes that were supposed to be implemented at the beginning of 2012. Americaid couldn’t get the billing system to work and basically didn’t pay providers for a 5 month period at the beginning of this year. People have NO idea what a massive cluster@@@ this interference by the government is in the healthcare system. But Bureaucrats know best and all that. Sigh.

And ask for the regulations to be sent to you on PAPER so you have something to burn. Ask for as much PAPER as you can get from the federal government because it will soon be worth as much as the money. You’ll need a lot to burn with Let it Burn, so you might as well get free stuff to burn, you know?

You have misunderstood my comment. You do not have proper context to draw the conclusion you have drawn. However I will point out to you per your comment, that trolls who are here simply to goad good commenters into being banned, should be shown the door. You start your own Conservative blog and write the rules which appeal to you. I was merely asking for clarification on something. Think of it as a housekeeping issue. When I call for someone to be banned its because they deserve it. Read the rules for commenting privileges here at HA.

It takes a lawyer and a consultant to interface with the EPA or IRS. This ought to go just as smoothly. Put a medical condition that needs treatment into the equation and I’m sure the g’ment will make it easier.

One big issue is cost: the law requires states to find their own funding for the exchanges by 2015.

This month, Maryland officials estimated a long-term cost of $33 million a year to run its exchange and suggested charging carriers an assessment to join the exchange, as well as a fee on group plans sold outside the exchange, to pay for it.

The federal government plans to charge a 3.5% fee on plans sold through exchanges it operates.

Fees and costs everywhere and somehow this is supposed to save money. Do the feds realize that they have to pay all these fees too on govt. employees raising costs further for taxpayers? We need to take back the public schools and require regular classes in basic math, basic economic and government oh and maybe some classes in logic.

What sort of idiot thinks that the travel industry has anything to do with medical care and that it is the pinnacle for ease of use? Health care isn’t a destination, its a process.

If it is just about getting a good (medicines) or a service (seeing a doctor) then why not a different approach?

Why not an Amazon of health care?

Or, even better, an Ebay of health care?

I could use an Ebay of health care! Get what you need via bidding for it, with some people offering a ‘Buy It Now’ option. And you can run different styles of auction, too!

Maybe a set-up where people with particular conditions can get together and as more of them signed up for a particular package the price got lower… now wouldn’t that be inventive?

Insurance? Where you are betting you are going to get sick and the insurer is betting you won’t? Sorry, health care is the worst possible thing to put into the insurance category… particularly if you already have problems. That entire ‘get together with people with a similar condition to get crafted plans’ sounds a whole lot better than ‘insurance’. Insurance is actually the worst model you can have for health care, not the best, nor the cheapest, nor the one that drives costs down. I can think of at least 3 different models that would work better, drive down costs, assure care… and they aren’t insurance at all.

Just curious, how many here will simply comply with Obamacare and how many will say he11 no and let them do what they need to do? I long for the day when people say ENOUGH! Sadly, I’m afraid that day is a long way away. The men that started this country would NOT have stood for this. Most now are scared they’ll lose their comfortable lifestyle, you know, not worth it. I don’t believe America will ever be what it once was. Just my two cents though.

Air, it may not actually come down to a voluntary decision to comply with the mandatory purchase or be fined rules once this gets fully implemented because of the sheer cost of the policies. There is no way they “bent the health care cost curve downward” with this clustermess. Already my individual policy is not $657 a month, and it was only $325 a month 5 years ago. I am 10 years away from Medicare, assuming that even is still around by then. At this rate, my individual health care premium will be close to $2K per month.

Since the pre-existing rules are out, it may come down to ALL Americans opting out, deciding to pay the fine, and then only buy their insurance on their way to the hospital when they are in the ambulance.

Something has to give because what they are attempting to do just won’t work.

I have 2 annual appointments that I just finished, the annual physical and a diabetes specialist. My primary care physician honestly believes that Americans are going to be out on the street in pitchforks by the summer of 2014 when it sinks in what a nightmare that Obamacare will be in their lives. My diabetes doctor told me today that the government is slashing doctor reimbursement by around 40% in January (a year before Obamacare kicks in). He believes doctors will just drop medicare patients or refuse to accept new ones.

Unless they make it mandatory that health care providers MUST treat all comers, just like the ER room rules, health care rationing is going to happen even without the official death panels that are setup in Obamacare.

I read over in England that some people have to wait YEARS to finally get assigned their own primary care doctor in their health system.

And to think that 51% of the voters re-elected BarackyClause to get this “free” stuff. Heartbreaking.

I read over in England that some people have to wait YEARS to finally get assigned their own primary care doctor in their health system.
karenhasfreedom on December 14, 2012 at 9:21 PM
That’s not true,you can even register with a GP if you are visiting an area for 3 months.
There is also open GP units that anyone can go to,we also have drop in centres and minor injuries units you can just go to. As well as Accident and Emergency.
mags on December 14, 2012 at 10:41 PM

I do not care. It’s legal plunder, theft, to steal from someone who does not choose to relinquish what’s theirs to pay for someone else’s healthcare or any other thing for that matter. And I do not care what tear-jerking anecdote you come up with nor how wonderful any other country’s healthcare system is that’s funded by stolen money. You pay for yours and I’ll pay for mine, unless I CHOOSE to pay for yours.

This law seems to conflict with another. Didn’t the Supreme Court find a right to medical privacy in the Constitution? If so, how can we now be required to submit our medical records/history to the IRS? Could Roberts have decided the way he did as a means to strike down Roe? Not that it matters because Obamacide will go the way of Prohibition….but not before the Mafia is running medical speakeasies!

Several states, like Tennessee, passed laws stating their citizens do not have to abide by Obama a macabre. Govs of these states could not then turn around and say they are going to run Obamacide on the state level….unless they want to generate even more law suits.

Also, there are states like Tennessee that have no state income tax which would Be forced into one to pay for the operation of a state exchange. And since the TN Constitution forbids a state income tax, it would be political suicide to even attempt.

My husband has been searching for info on the defense bill to be passed (he is retired military). He just told me that the government will possibly raise our prescription copays from $12 to $51! And my compounded hormones that were a last result to control my severe menopause symptoms may not be covered at all. We are unemployed and I have no idea how we are going to pay for that. We may have to just buy the prescriptions that our kids need and maybe my hormones. I have diabetes and other problems too. We are only getting by now with charity from relatives and friends.

My family doctor has quit taking any more patients. She is only keeping me because she feels the military is getting a poor deal and both she and I have a disabled child.

Seriously folks, what’s up with the banning requests? Are you that scared of trolls coming in and posting some idiotic thing that most people laugh at? I would expect liberals to be heavy handed on the ban button because they hate to be challenged. I would expect more cajones out of a bunch of conservatives who usually relish debate.

You can’t have a real discussion if you keep banning opposing views.

Ronaldusmax on December 14, 2012 at 7:14 PM

Agreed. However, this site could do with an ignore poster button. That would make the system work itself out really well. :) :) :)

I do not care. It’s legal plunder, theft, to steal from someone who does not choose to relinquish what’s theirs to pay for someone else’s healthcare or any other thing for that matter. And I do not care what tear-jerking anecdote you come up with nor how wonderful any other country’s healthcare system is that’s funded by stolen money. You pay for yours and I’ll pay for mine, unless I CHOOSE to pay for yours.

air_up_there on December 14, 2012 at 11:07 PM

I am in the U.K and work in the NHS I don’t care what system you have
but if we are dragged into it ,it would helpful to actually report correct information

Once again; look up the “Principle of Subsidiarity” Had it been the basis of debate and individual/state/fed relationships, we wouldn’t be here, but the GOP loathes and recoils at the thought of dealing with social/Nature’s God/issues – though all of our freedoms come only from Him.

All political issue at the core remain moral issues. It is immoral for the government to force (steal) our responsibility and authority to do things at the lowest possible social level.

Unfortunately, it certainly appears that we had at least some bishops seeking this “charity” from Caesar…

This law seems to conflict with another. Didn’t the Supreme Court find a right to medical privacy in the Constitution? If so, how can we now be required to submit our medical records/history to the IRS?… devan95 on December 15, 2012 at 12:21 AM

Because those same radical feminists that cheered about privacy with their Doctor (Roe vs.Wade) are the same souls that laughingly gave that right to every bureaucrat in the US government when they saw socialized Obamacare as a bigger prize.
Hypocricy is a badge of honor to a liberal. Put another way: any means to an end–and the end is socialist inspired loss of freedom.

It is funny to see the democrats try to work with this Dumbo law and pretend like they had nothing to do with it, and it is the fault of 33 republican governors that it can’t work. I suppose it is the fault of republicans like Scott Brown, that we still have the tax on medical devices. It is Scott Brown’s fault that we have the nasty bill that we have now. He Prevented them from bringing up a better bill for a vote, they had to stick with the nasty one that had passed with a dem placeholder.

The secretary shall make a decree with her magic wand, and you will obey and it will all be “fixed.” I guess that is my fear that the HHS will use extremist methods to Punish these states.

The Democrats are to Blame for this horrible 3000 page plus rules, law.

I do not care. It’s legal plunder, theft, to steal from someone who does not choose to relinquish what’s theirs to pay for someone else’s healthcare or any other thing for that matter. And I do not care what tear-jerking anecdote you come up with nor how wonderful any other country’s healthcare system is that’s funded by stolen money. You pay for yours and I’ll pay for mine, unless I CHOOSE to pay for yours.

air_up_there on December 14, 2012 at 11:07 PM

I am in the U.K and work in the NHS I don’t care what system you have
but if we are dragged into it ,it would helpful to actually report correct information

For goodness sake,I corrected this statement,Air did not care if he had the right information

I read over in England that some people have to wait YEARS to finally get assigned their own primary care doctor in their health system.
karenhasfreedom on December 14, 2012 at 9:21 PM
That’s not true,you can even register with a GP if you are visiting an area for 3 months.
There is also open GP units that anyone can go to,we also have drop in centres and minor injuries units you can just go to. As well as Accident and Emergency.
mags on December 14, 2012 at 10:41 PM

It seems to me that nobody at the Federal level really pursued getting the necessary infrastructure (rules, regulations, interpretations, hardware, procedures) to implement ACAPPA possibly because it was not a priority (maybe for political reasons) and perhaps because the powers that be did not fully or really comprehend the magnitude and complexity of the task.

If this had been a business project, I am pretty sure that whoever came up with the proposal would have been working very hard to get it all together because to end up, years after the proposal was given the go-ahead, on a countdown to launch date with virtually (it seems) little show for going live, that person or persons would be sweating profusely because it would be their jobs on the line (and a failure like this would haunt them for quite a while). Fortunately, those who passed it are politicians and the failure of a bureaucracy to get it done seems to be par for the course.

what happens when someone opts for the fine instead of buying the insurance?
Not like the employer is going to have a lot of full timers, so it won’t be the employers burdening the system.
What was that fine level for not buying insurance?
This thing smells like a dead skunk roadkill.